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Trump ‘acting swiftly on intellectual property theft’

Last August Mr Trump signed an order directing U.S. Trade Representative Robert Lighthizer to open an investigation against China under Section 301 of the Trade Act of 1974 for violations of U.S. intellectual property rights. Reuters.

U.S. President Donald Trump Wednesday hinted that his administration is “acting swiftly on intellectual property theft”, in an apparent reference to China which is known for intellectual property theft of U.S. products and services around the world. Politico quoted officials saying the president would go after China on trade issues after months of being urged to be more moderate but to no avail. 

The move is coming as the president prepares to announce series of tariffs on steel and aluminum products imported into the country despite opposition from his fellow Republicans.

“The U.S. is acting swiftly on Intellectual Property theft. We cannot allow this to happen as it has for many years!” Trump tweeted.

Last August Mr Trump signed an order directing U.S. Trade Representative Robert Lighthizer to open an investigation against China under Section 301 of the Trade Act of 1974 for violations of U.S. intellectual property rights, Politico reports.

Officials are examining whether any of China’s laws, policies, practices or actions force American companies to transfer valuable technology to compete in the market or otherwise fail to adequately protect intellectual property rights, according to Politico.

Senior administration officials and Cabinet secretaries have met for months to reach a consensus on possible U.S. response to the issue.

Politico noted that the administration is now considering tariffs on over 100 Chinese products as a result of the inquiry. Officials are also considering imposing investment restrictions that would prevent Chinese officials from acquiring, controlling or even owning significant shares of U.S. businesses or other interests, Politico quoted two people briefed on the internal debate.

It is not yet clear when Mr Trump might make the announcement but administration officials say the president would take action soon on the issue.


Administration officials and Lighthizer want to use the Made in China 2025 plan – a coordinated industry policy Beijing is using to upgrade the country’s manufacturing sector- as the basis for any specific tariff and investment actions, Politico quoted an administration official involved in the planning.

USTR is also examining a list of possible items that would benefit from tariffs that go after China’s industrial policy which Mr Trump’s Council of Economic Advisers analyzed and found the targeted tariffs could have the desired effect of hurting China for three to four years but then they would become ineffective and might even hurt consumers and businesses, an official said.

“USTR just want to shoot first and figure it all out later,” the official said.

The internal deliberations are handled by the Treasury Department and tough legal questions on its implementation abound.

The USTR report right now includes language that would restrict more than 1.3 billion China’s citizens from investing, Politico reported. Officials are also considering how to narrow the restrictions to government-directed or –controlled entities. An administration official said the Trump administration is weighing which sectors of the U.S. economy are most at risk from Chinese investment and need to be protected.

“We’re trying to do this in a way that we don’t immediately get sued at the World Trade Organization,” the official said.

Most administration officials involved in trade discussions had hoped Trump would announce the intellectual property actions before the steel and aluminum tariffs. The 301 actions are supported by many Trump aides.

U.S. technology companies have long argued that China’s trade practices result in the theft of U.S. intellectual property and in some cases force U.S. companies to transfer technology to Chinese authorities as a condition for doing business in China and noted that in some instance U.S. companies are forced to transfer technology to Chinese authorities as a condition for doing business in the country, according to Politico.

Some also say that forced technology transfers are subsidizing state-owned companies in China and helping with state-sponsored cyberattacks and corporate espionage. The administration has a one year window to conclude its investigation into China’s intellectual property and technology transfer policies after Trump initiated the process by signing a memo in August 14.

Lighthizer has long wanted to use authorities like Section 301 to punish China for its trade behavior. During his confirmation hearing last March, the trade chief was quoted as saying he was “committed to using all available tools, including Section 301, where appropriate, to address China’s unfair foreign trade practices.”

According to Politico, the law was used frequently throughout the 19980s when Lighthizer worked as deputy at USTR to extract concessions from U.S. trading partners but the U.S. stopped applying the measure after the World Trade Organization was created in 1995

Some trade experts have warned that any unilateral move to sanction China with tariffs directly without going through a dispute process at the WTO could hurt relations with China.






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Trump ‘acting swiftly on intellectual property theft’ Trump ‘acting swiftly on intellectual property theft’ Reviewed by Bassey Akpan on March 08, 2018 Rating: 5

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